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Nick Jimenez Nick Jimenez, Caller-Times editor, writes a weekly editorial column Sundays. He can be reached at 361-886-3787 or jimenezn@caller.com. Sunday, June 4, 2000 Q&A on Corpus Christi's budget plight
Editorial Page Editor Nick Jimenez interviewed Corpus Christi City Manager David Garcia about the proposed 2000-2001 budget. The following is an edited version of that interview.
Q. Your proposed budget for the next year includes reductions totaling almost $6 million, or about 5 percent of the general fund. Included are proposals to cut library hours, eliminate summer youth programs, summer band concerts, and cut fire and police budgets. It proposes cutting 130 city positions, including the elimination of two entire departments. Sixty-one of those positions are now filled. Are things that bad? A. I think the culmination of a lot of years of deficit budgeting, of basically spending more money than we had coming in, has finally come home to roost. The economic situation hasn't helped. Our economy has been very flat. There hasn't been a lot of growth. There hasn't been a lot of job creation. The city itself is a city that is based on a lot of very traditional industries, on agriculture, on oil, on tourism, and what's fueling the explosion in a lot of the rest of the country has kind of bypassed us. We don't have a big high tech industry. We don't have a lot of computer manufacturing. We don't have a lot of biomedical activity. We have suffered because of that. We basically drew down on our reserves to the point that basically we have no more reserves. We were severely understating our expenditures. We had a lot of expenditures that should have been in our operating budget that we had moved over to the debt service fund, which is not a good budgeting practice. What it did is that it understated the true expenses. We were essentially in a deficit spending position. We were misrepresenting a lot of our expenditures by having them in a completely separate fund. When we put them all together, and proposed a very accurate picture of what it was really costing us to run the city, and then tried to balance that from expenditures to revenues, that's when it became clear how out of balance we were. Q. Is raising taxes out as an alternative to simply cutting services? Is that entirely out of the picture? A. I think it is. One cent in property tax would get us $730,000. If we were going to make up the $7 million in cuts out of a property tax increase, we would need a 10-cent increase in the property tax. Right now we're at 62.3 cents. We have a charter-imposed cap of 68 cents that we can't go above. It would take all the remaining space that we have underneath the cap and we still wouldn't have enough to make up the deficit. We clearly don't want to be pressed up against the cap. That removes any flexibility that we have to raise any revenue. We've been at 62.3 cents for about five years. There hasn't been any revenue increase, but the reality is there's not a lot of flexibility under that cap. That's part of the reason that really the only options have been to reduce expenditures or to increase user fees. Q. Are higher user fees out of the picture? A. No, they are not. One of the strategies that we make, particularly because of our limits on ad valorem taxes, is just to begin to charge people more directly for what have been traditional municipal services. That burden falls more heavily on the poor when you start charging for recreational services and you do improvement districts for street repairs. The older neighborhoods are the ones that get hit the hardest. That's not traditionally the way you want to do that, but as our ability to finance municipal operations gets more constrained, we have fewer options. Q. All these budget proposals are just proposals so far, right? A. The charter requires the city manager to deliver a budget proposal to the council 60 days before the end of the budget year. So we needed to provide them our recommended budget and it needed to be a balanced budget by Aug. 1. The balance we propose is a balanced budget. It balances expenditures to revenues and it also takes the first step in establishing a reasonable ending balance. The balance in this budget is about $4.4 million, of which $4 million is unencumbered by expenditures. The financial policies for the city call for us to move to establish a 5 percent ending fund balance, which would be about $6 million. We can do that over several years, but we need to take some initial steps to give us a reasonable reserve. The fund balance for this year will be just about $2 million. Q. You are proposing to cut $804,608 from the fire department budget and $393,289 from the police department budget. How would you assure the average citizen that public safety is not being harmed by these cuts? A. In prior budgets, the police and fire departments have been exempt from cuts. Police and fire are about 51 percent of our total expenditure. So if you say 51 percent of your organization can't be touched, you have to take all of the cuts out of the remaining 49 percent. You compound the severity of the cuts that you need to make in streets and in parks, in solid waste and all of the basic services that we have remaining. The council said every department is on the table. They did make very clear, though, that in looking at police and fire, not to make cuts that affected the ability of the police department to protect the community and of the fire department to respond to emergencies. What that translated to me is to not reduce the number of officers that we have on the streets or the number of firefighters responding to calls or the number of medics in ambulances. Our cost cuts deal almost exclusively with the administrative section or, in the case of the police department, it dealt with the academy or new people who would be added to the department. Q. What guidelines did you follow in proposing cuts? A. The main one was to try to make cuts that would have minimal impact on the delivery of basic services. Some departments are small; some are larger. Some are heavily service-intensive. Our solid waste department has very thin administrative staff. Most of their people are in trucks and out in the field. We've got a minimal amount of clerical and administrative staff to cut. Over the years they've been cut to where there's very little there. So it's very difficult for us to make any cuts in the solid waste department that won't translate into some change in service. That's the reason that one of the recommendations is moving toward once-a-week garbage pickup. The parks department today is not doing an adequate job of maintaining parks because we've stretched them so thin over the years as we've cut back maintenance crews, as we've cut back equipment. Any further cuts will have very deleterious effects on our service. But we're at the stage now where it doesn't do any good to reduce the number of people on a crew when you've got a two-man crew. At some point you've either got to eliminate it completely or find someplace else to cut. We're at the stage now where we have to eliminate whole services because there's no fat left in the organization. There are no easy cuts left to make. Q. Speaking of once-a-week garbage service, that is one cut that will affect every household in Corpus Christi. That is a proposed saving of $573,933. But can that really work? Should we all go out and buy larger garbage cans, get a compost heap or recycle more? A. We are moving into an automatic garbage pickup program, which has much larger garbage cans, which will allow us more flexibility in the pickup service. There are parts of town that effectively can work pretty well with once-a-week garbage pickup. If you can look at your own garbage pattern, I'll bet you there is one day a week when you have a lot of stuff out there and the second garbage pickup you have a lot less. That's a pattern that we see all over town. Basically there's one garbage pickup that is used very heavily by people and whenever the second pickup is that week we get about 60 percent to 50 percent of the first garbage pickup's tonnage. Instead of sending a crew by your house twice a week, we'll be sending a crew by your house once a week. If we do it once a week, the same crew will be able to cover twice as much area. We tried to balance service delivery with available resources. And there are not the available resources to maintain the existing service delivery. We cut in ways that we felt would allow us to maintain minimal quality of services. And we just cannot continue to do the same things we did last year. All you have to do is look at the price of gasoline. And think of the vehicles we have to fuel every day: police cars, fire engines, and garbage trucks. Our revenues are just not there and we have to do less. Q. The parks department, as you said, has been under severe restrictions for years. The city libraries are already below national standards. Now they are being asked to cut operating hours and personnel. Won't they fall further behind, and will they ever be able to catch up? A. We are falling further behind. We have not invested in the basic infrastructure that it takes to run this community. Streets are deteriorating. Traffic signals are deteriorating. Parks and libraries are deteriorating and we're not maintaining them adequately. The standards that we provide our citizens are below what would be expected in many other cities. The reality is that we just can't afford to do anything else. Q. Lobbyists are a small item, but an item of great interest. You have proposed to cut two lobbyists from the budget. What difference will that make? A. We lose access. We lose people who can walk into the governor's office and into the lieutenant governor's office. We lose the opportunity to have our programs put before the House in an expeditious way. There has been a real uproar about lobbyists. People don't feel that lobbyists are something that Corpus Christi needs. I disagree with that. I've been in the legislative process long enough to know how much damage you can do to a community if you're not effectively represented in Austin. Legislative changes can effect our revenues; our ability to annex can be changed overnight by legislation we're not adequately represented on. But I know that it's a political issue and that we're going to struggle and we're going to do the best we can in trying to protect the interests of our citizens in Austin and in Washington. Q. You are proposing to eliminate entirely the Human Relations Division and the Internal Audit Division. That's eight positions. Why those divisions? A. Those were very painful decisions. The Human Relations is a very well run department. It has our fair housing program. It has spearheaded our disparity program. The problem is that it's not a basic service for us. It's not in our core group of services. Neither is our Internal Audit. Internal audit gives us a safety check on our cash management. We contract with external auditors who provide some level of oversight. They were a safety net for me to ensure that there was adequate record- keeping and accountability. But they were sort of redundant. Good function. Love to have it. But we just can't afford it. Unfortunately, when you look at the decisions we're having to make that affect our ability to pave the streets, to keep the traffic signals running, to continue to pick up garbage and our ability to do basic things, as you prioritize, there are some important things that don't come to the top of the priority list. Q. If it comes to laying off 61 city employees, how will that be carried out? A. It's very difficult to tell how many, if any, of those people will actually have to walk out the door. Each one of those people has a specific bundle of rights associated with their employment. It depends on their seniority with the city, their seniority in that position, and what other skills they have. As we target a specific position for replacement, we'll see whether that person has a right to another job. It's not unusual in one reduction for two or three people to be bumped from positions with less seniority. It's also not unusual to find a position that a person is qualified for. Ideally, the actual number of people who would have to leave would be very few, but there will be a lot of disruption in the organization. When you go through a trauma like this, you wind up losing a lot of people who might be threatened with being bumped who choose to retire. You lose a lot of your senior people. This is not an easy thing to do, but it's one I feel right now is unavoidable. Q. Some cuts, such as the elimination of the summer concert series, impact on services that are not basic, but are highly popular. Won't that particularly hurt? A. Nobody likes to cut the summer concert series. They are very popular. The reality is that we're struggling with our ability just to keep the parks mowed. When you trade off going to an eight-week mowing cycle vs. a six-week mowing cycle vs. a summer concert series, we have to opt for the six-week summer cycle which lets kids at least get into the parks. If you have two-foot high weeds in the parks, nobody can use it. Basically, we're struggling to keep the parks open, much less to hold a concert series. Q. Is this an opportunity to institute new efficiencies? A. Not really. There are a lot of efficiencies that can be had that involve automating, substituting technology for manual processes, having people pay their water bill over the Internet, things like that. The problem with being innovative in that way is that it's expensive. You often don't realize the cost savings for several years. We don't have the resources to be real innovative right now. We're in a mode where we can't make major investments. We're struggling just to keep the old trucks and mowers running. We've got a very old fleet. We've got equipment that most other communities would have junked years ago, but we can't afford to. Q. How long will it take us to get out of this? A. I think if we have a good solid disciplined budget approach over the next two or three years, we'll be on good solid footing.
© 2000 Corpus Christi Caller Times, a Scripps Howard newspaper. All rights reserved. |
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